Can fewer leads mean more sales?

Christine Nurnberger, VP-marketing at SunGard Availability Services, knew she had a challenge on her hands when she took over the marketing function at the cloud-hosting and disaster-recovery company 18 months ago.
The marketing department was “working really hard,” she said, engaged in almost 1,000 marketing tactics annually; but the sales department was still unhappy with the quality of the leads.
“There was a lot of friction between sales and marketing,” Nurnberger said. “The leads weren't sales-ready, and there was no handshake in place to transfer leads from marketing to sales. Of the 1,000 marketing tactics we used a year, less than 3% had any impact on revenue.”
Nurnberger did the unthinkable for many departments: She looked for ways to whittle down the number of leads, stripping away the prospects that weren't sales-ready and focusing on finding prospects who were. She did this the old-fashioned way—by sitting down and talking to sales, profiling customers and identifying weaknesses in SunGard's internal systems.
“I spent my first 30 to 60 days analyzing what was going on, and then went to sales with a plan,” she said. “They were excited to see a plan and cautiously optimistic.”
The plan involved aligning all marketing activities with specific revenue goals. If a marketing activity couldn't be linked directly to bottom-line revenue, it was pared back or dropped.
“We aligned every member of our team with sales revenue objectives,” Nurnberger said. “We started reporting and forecasting exactly like the sales department.”
That type of alignment isn't all that common. According to a study by BtoB, marketing departments tend to work relatively independently within their own sphere: Only 27% of respondents said they worked closely with sales in scoring, nurturing, tracking and coordinating feedback.
This process is radically different among the most effective marketing departments, BtoB found. Among this group, 53% are highly engaged with sales. (BtoB's study is based on an online survey of 605 marketers which took place in August and September 2012.)
According to Douglas Burdett, principal at b-to-b marketing agency Artillery, Norfolk, Va., this kind of cooperation makes good business sense.
“Companies with strong sales and marketing alignment get 20% higher annual revenue growth,” Burdett said. “The most fundamental building block of sales and marketing alignment is agreement on goals, where the marketing pipeline and sales quota are two ends of the same stick.”
SunGard uses Marketo marketing automation software, combined with Salesforce.com as its CRM sales solution. Its approach: Customize Salesforce.com's platform heavily so SunGard's marketing department can more easily track what happened to leads once they go into the system. This crucial feedback allowed the marketing department to identify the leads that were high-quality, which enabled it to draw up an improved customer profile.
“The last thing we did was really understand the customer profiles we were winning with and then expanding our footprint in that area,” Nurnberger said. “We studied the data to align our campaigns with the companies that were actually buying.”
The results have been strong, with sales-per-qualified lead quadrupling, she said. “The more targeted we got, the better we performed,” she said. “As an example, we did a very targeted campaign directed to just 225 companies. We did three offer messages and focused like a laser. Today, 65% of those companies are in our pipeline.”